Is abolishing landlord levy a good idea? Five questions and answers

1. For the thread with it: what exactly is the landlord levy?

No, this is not a tax for all people who rent out a property. You only have to deal with the landlord levy if you own more than fifty rental properties.

Moreover, this only concerns cheaper rented houses: because only rented houses whose rent is lower than the housing benefit limit (from this year 752.33 euros) count for the tax authorities.

In practice, the levy therefore has to be paid mainly by housing associations, but also by wealthy private landlords who have quite a few social rental homes.

2. levy a tax on social housing, why are we doing it?

The landlord levy dates from 2013 when there was an economic crisis in the Netherlands. The then Minister of the Interior Stef Blok (VVD) introduced the tax measure – which was part of the coalition agreement ‘Building bridges’ of the Rutte II cabinet – to fill the treasury.

Strangely enough, the levy was originally presented as a temporary crisis measure. The state desperately needed the extra money after the nationalization of ABN Amro and Fortis, the direct costs of which were later estimated at more than 30 billion euros.

But now eight years later, the levy is proving to be more persistent than expected. We may therefore conclude that it has become a structural policy.

This Sunday there will be demonstrations in Amsterdam for the first time in a long time against the housing crisis. Everyone knows someone who has to deal with the great shortage of affordable housing. RTL Z visited a number of them.

3. What are the frequently heard arguments against the levy?

The landlord levy has been attacked from all sides from day one after its introduction. We quickly list the most frequently heard counter-arguments for you:

  • The levy is at the expense of social housing.
  • The levy leads to higher rents.
  • The levy delays the sustainability and renovation of homes.
  • The levy costs construction companies and suppliers additional contracts.
  • The levy forces housing associations to sell much-needed social housing.
  • The levy does not have to be paid by slum landlords and speculators.

“We are eager to build new rental homes,” Hester van Buren, chairman of the Rochdale housing association, told RTL Z. “The condition is that something must be done with the landlord levy. This is also laid down in the housing agreement. borrow money now to be able to invest.”

According to Van Buren, Rochdale sells about a hundred homes per year because of the costs of landlord levies, which have risen to 48 million euros per year for the approximately 40,000 homes of the housing association. “With this levy, the cabinet is forcing us to sell social rental housing and to invest the proceeds from it. We do not want that: we want to sell as little as possible.”

4. And what do proponents actually say about the levy?

With all the kicking against the tax measure, we almost forget that there are also proponents. Although the main argument for the landlord levy is simple: the revenue of about 2 billion euros per year ends up in the state treasury. So we can finance public goods and keep other taxes – which usually affect more people – lower.

Politically, VVD is the party that continues to defend the controversial tax. “There is a lot of lobbying to abolish the landlord levy,” says DaniĆ«l Koerhuis, Member of Parliament at the VVD and spokesperson for living and building there. “The assumption is that corporations would then have more money to build houses, but there are already billions on the shelf for new construction that are not being used. The fact that too little is being built is not due to lack of money, but is due to lack to construction sites.”

5. Will the landlord levy continue to exist for a long time to come?

That depends on the new cabinet that is still in the making. Given the growing resistance and the crumbling political support, there is a good chance that the landlord levy will at least be gnawed in the coming years.

In contrast, the VVD once again became the largest party in the Netherlands in the elections in March. The election program states that the party wants to maintain the landlord levy. The VVD does want to reduce the levy for housing associations that make their housing stock more sustainable, depending ‘on the size of the investments in sustainability’.

So to be continued.

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